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Clearance of San Po Kong Factory Estate will not be extended

    The Housing Department today (February 20) appealed to the remaining tenants at San Po Kong Factory Estate to accept the ex-gratia allowances ranging from 100 to 130 months' rent as the clearance date will not be extended.

     "Based on the ex-gratia allowance calculated at $3,000 to $5,400 per square metre, tenants will be granted allowances ranging from $72,000 to $1.49 million," a spokesman for the Housing Authority (HA), said.

     Originally scheduled for clearance on May 31, 2005, the operation has been extended three times to August 3, 2005, November 30, 2005 and subsequently to February 27, 2006 at tenants' request for more time to arrange relocation.

     "Any further extension of the clearance date is not possible due to the unsatisfactory condition of the building," he said, adding that large-scale strengthening works had been put in place to ensure building safety.

     Over 90% of the 912 tenancies occupying 2,008 factory units have already moved out. A total of 419 tenancies had surrendered their units under the Early Surrender Scheme and accepted an amount equivalent to 75% of the ex-gratia allowances then being offered to the factory tenants. Currently, there are 70 remaining tenancies (about 8%) occupying 161 factory units.

     The Housing Department issued Notices-to-quit and eviction notices to the tenants on November 30, 2004. A total of 56 tenants lodged an appeal against the termination of their tenancies in 2004. The Appeal Panel confirmed the Notice-to-quit on May 17, 2005 after it had fully considered the cases.

     In line with established policy on clearance arrangements, affected tenants have been given 18 months' notice to vacate, with rent frozen from October 31, 2003.

     "They will be offered ex-gratia allowances and three months free rental when leasing other factory units under the Housing Authority or a cash sum if they choose to go elsewhere in the private sector," the spokesman said.

     The spokesman noted that tenancies in six factory estates at Cheung Sha Wan, Jordan Valley, Shek Kip Mei, Kwai Chung, Shun Kei (Tsuen Wan) and Yuen Long that have been cleared over the past few years were being offered the same terms.

     Stressing that the approved ex-gratia allowance rate was reasonable, the spokesman said any upward adjustment was "not considered appropriate as the ex-gratia allowances compare reasonably with the latest market rents of private flatted factories in the San Po Kong area, the government ex-gratia allowances on land resumption and clearance and the average tendering monthly rents for HA factory units over the past two years.  

     "Tenants who wish to re-establish businesses in other HA factory units may take part in the open tender or restricted tender exercises," he said.  

     A total of 11 restricted tender and 15 open tender exercises have been arranged for tenants affected by factory clearance since February 2004. Of the 70 tenants taking part in the restricted tender exercises, 58 tenants successfully bid for vacant units in other HA factory estates.

     Built between 1962 and 1965, San Po Kong Factory Estate comprises four five-storey blocks and two seven-storey blocks with 24 sq metre standard size factory units. The Strategic Planning Committee of the HA approved on September 11, 2003 the clearance of the estate due to increasing obsolescence of the design in comparison with current needs and the burden of maintenance with age.

     A consultancy study will start later this year to ascertain the site's suitability for public rental housing development.  

Ends/Monday, February 20, 2006
Issued at HKT 18:01